In Part One of this editorial series, we shared a quote from Pagosa Springs Town Council member Mat deGraaf, spoken during the Council’s four-hour discussion about the ongoing housing crisis, on July 15.
“Something that’s really pertinent to the [tourism discussion] is ‘capacity.’ I mean, we can bring people here, but if it’s a two-hour wait to get into each and every restaurant, they probably aren’t coming back. Right? So it’s a bigger issue…”
The problem — the ‘lack of capacity’ problem — has hit every mountain resort town in Colorado in a very noticeable manner, and the COVID pandemic is at least partly to blame. Last year, when Americans stopped flying in airplanes, they didn’t necessarily postpone their vacations. Apparently, they just picked a destination they could drive to, rather than fly to. And one of the popular, centrally-located, accessible, ‘drive-to” destinations, for pretty much anyone west of the Mississippi, was Pagosa Springs.
This tendency has apparently extended into 2021.
One of the results of that demographic shift has been a striking increase in local tax collections — Lodgers Tax and sales tax — with the result that our local governments having more money than they know what to do with.
Another result has been a mass conversion of residential homes into ‘mini-motels’ — vacation rentals.
Here’s Tourism Board member Michael Whiting, commenting at that board’s July 13 meeting, during a discussion about using Lodgers Tax funding to address the housing crisis.
“Re-allocating Lodgers Tax towards [the housing crisis] — I think the response needs to be proportional. What I mean is, it’s not vacation rentals that are THE problem. We should be tapping everyone…”
I think what Mr. Whiting is saying here is: the current housing crisis is caused by many factors. Low wages. Land use regulations. The national economy. Vacation rentals. Growth. Greed. So the whole community ought to be kicking in. The tourists ought to contribute to the solution. Businesses ought to contribute. Government ought to contribute. Retirees ought to contribute.
Hell, he might mean that even the Daily Post ought to contribute.
“It’s a global change in the culture of tourism. But on top of that, it’s also a problem of… I’ll say it: I was in office for eight years… it’s a problem of inaction on the part of all the governments. And all the boards of directors of our top 25 businesses… We haven’t seen any meaningful contribution to solving the problem until about a year ago…”
This statement is true. While the Town and County governments have been spending millions of tax dollars promoting tourism, the only thing spent on the problem of workforce housing has been, for the most part, hot air.
More hot air was expended yesterday morning early — starting at 7:30am — at a special meeting of the Pagosa Springs Area Tourism Committee, a group of volunteers that recommends an annual tourism promotion budget for approval by the Town Council and County Commissioners.
The meeting lasted until 9:30, and everyone was in agreement on one thing: the Bylaws for the Tourism Board should not be amended.
Actually, there was another thing on which everyone agreed. That we’re in the middle of a crisis.
And maybe one other thing: that we don’t currently have a central agency addressing the housing issue, that can coordinate contributions — the contributions from the Daily Post and everyone else — and make sure they are used effectively to address the crisis.
About almost everything else, the board had a variety of opinions. But the overwhelming majority seemed to agree with Mr. Whiting, that vacation rentals are not THE problem.
In fact, some of the Tourism Board members seemed to feel that government regulations are THE problem.
For example. Board member and Realtor Lauri Heraty, shared around the table a printout of a news article from the July 15 Pagosa Springs SUN, written by reporter Joe Napolitan. The article summarized recent recommendations coming from the Town Planning Commission. The commission had unanimously approved “a trio of recommendations”:
Town planning commission approves trio of short-term rental recommendations
During a meeting on July 13, the Pagosa Springs Planning Commission voted unanimously to make the following recommendations to the Pagosa Springs Town Council:
- Institute required ownership for two years before a short-term rental (STR) license may be applied for in a residential district.
- Increase the STR license fee by at least a factor of 12 for non-owner-occupied units, 100 percent of which will be dedicated to workforce housing projects.
- Reallocate revenue from lodgers’ tax to the maximum extent possible toward workforce housing projects.
Here’s Ms. Heraty:
“Something that you don’t realize, when you’re sitting at a [government board] table — and from myself, working in the [real estate] industry — when you come down this hard, this quickly. We had dinner with some [vacation rental] owners who became friends of ours; Grandma and Grandpa, three daughters, a son, and then a bunch of grand kids; and they have a huge house here. And they use that house a lot, because of the amount of family that they do have. But when they don’t use the house, the house rents for $500 to $850 a night.
“At dinner, they said — after this [SUN] article came out — that, ‘We’re not doing this anymore. We’re gonna go ‘rogue’. We’ve got enough people working, and we’re just going to advertise on our work boards, and just rent to family and friends and co-workers, and we’re not going to play this game anymore, because we feel victimized…'”
The friendly dinner, to which Ms. Heraty was referring, had taken place the same day the SUN article had appeared.
“So that night, they said, ‘We’re done.’ So they will continue to run a vacation rental, but through their own contacts… And these are your high-end people — $800 a night, through the summer, when they’re not using it — that’s no longer going to have the tourism tax benefit, to us. And I think you’re going to see more and more of that. I think there are a lot of people who are saying, ‘I can do this without being on AirB&B…'”
As I listened to this story, it sounded like a family with a big house is now planning to operate their vacation rental without a permit and without paying the required Lodgers Tax, because they feel ‘victimized’.
I assume nobody in Pagosa wants the owners of a vacation rental to feel ‘victimized.’ Especially if they are making $800 a night renting out their house.
Read Part Five…